Audit indicates positive future for Dixon

City council starts review of closed session minutes

DIXON – Some of Dixon’s recent and infamous history was discussed at the recent meeting of the Dixon City Council.

Commissioners were given a presentation of audited financial statements from the 2012 and 2013 fiscal years, including former Comptroller Rita Crundwell’s final year with the city, and went into closed session to discuss releasing minutes from closed meetings after Crundwell’s arrest in 2012.

Crundwell last year was sentenced to 19 years, 7 months in federal prison for stealing nearly $54 million from the city throughout two decades.

A decision on releasing the closed-session minutes likely won’t happen for another two or three meetings, Mayor Jim Burke said, and would have to come back to the council as an action item on an agenda.

The audit started in August 2012, Wipfli’s Rory Sohn said, and had to begin with detailing and documenting the money Crundwell had stolen, in order to accurately adjust the starting financial figures.

Before Wipfli started the audit, the FBI took the city’s financial statements and accounting records, Sohn said, adding the auditors had to use the check register for the capital development account and bank statements from Fifth Third Bank.

The auditors were able to piece together the finances from 2002 to 2012, which accounted for about $50 million of the nearly $54 million that was stolen, Sohn said.

By starting in 2012 and working back, Sohn said the auditors were able to see the story of how the theft evolved, starting with overcharging businesses for sewer usage to writing checks for more than the city’s portion of actual projects that were receiving grants.

Going forward, the city has a “bright future,” he said, and the general fund could operate at a surplus. Paying off three bonds early, which Midland States Bank and Sauk Valley Bank allowed the city to do, will save the city nearly $4 million.

The city was paying about $500,000 a year in interest on those bonds, Sohn said.

The audit also looked at internal controls and found areas that could have been stronger. Some were simple, Sohn said, like the fact that Crundwell picked up the mail and the fact that the account she was taking money from was the only one with a manual check register. The other city accounts were automated, he said.